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Oil was higher in Asia on Wednesday morning, recouping some losses on anticipation that the Organization of Petroleum Exporting Countries (OPEC) and its allies (OPEC+) will limit oil production during a two- day summit.
By 10:37 p.m. ET, Brent oil futures had risen 2.33 percent to $70.84. (3:37 AM GMT). WTI futures increased 2.19 percent to $67.63, well shy of the $70 threshold.
Later in the day, OPEC will convene, followed by OPEC+ the next day, with the cartel set to put a halt to plans to increase 400,000 barrels per day (bpd) of production in January 2022.
Travel bans and concerns about fuel demand have been sparked by the discovery of the omicron COVID-19 strain, but some OPEC+ ministers have stated that there is no need to adjust plans.
“The market continues to look for signs of any impact of Omicron on demand,” ANZ Research analysts said in a note.
However, producers could struggle to supply more oil even if OPEC+ agrees to an increase. “The threat to oil demand is genuine. Another wave of lockdowns could result in up to 3 million bpd of oil demand lost in the first quarter of 2022,” Rystad Energy senior oil markets analyst Louise Dickson said.
Meanwhile, the American Petroleum Institute’s crude oil supply report for the week ending Nov. 26 showed a draw of 747,000 barrels, lower than the 1.667-million-barrel decline predicted by Investing.com. During the prior week, API reported a build of 2.307 million barrels.
Story by : Norvisi Mawunyegah